Europe is looking decently up compared to last month, for countries that have reported so far. Looks like the big hitters are doing particularly well compared to last month (Norway and Netherlands). The other big hitter, UK, will not report for a while but the feverishly predicted demise of the UK economy post-Brexit has yet to materialize, so I think UK could likely be good also (for this quarter at least).
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Europe is looking decently up compared to last month, for countries that have reported so far. Looks like the big hitters are doing particularly well compared to last month (Norway and Netherlands). The other big hitter, UK, will not report for a while but the feverishly predicted demise of the UK economy post-Brexit has yet to materialize, so I think UK could likely be good also (for this quarter at least).
I'd rather not share the spreadsheet itself since it hasn't proved to be reliable and I'm constantly trying to improve it. It's nowhere near ready for prime time and I'd hate for anyone other than myself to lose money based on my amateur modeling efforts.
I'm happy to share any predictive figures from it and my reasoning behind it, though - with heavy disclaimers.
EDIT: My numbers are for non-GAAP.
Ok, probably a bit off topic, but also "general high interest", here is the video of the SpaceX explosion (the actual explosion).
Apologies if this was already posted.
Apologies if this was already posted.
Anyone interested in finding out if it's possible to pursue a lawsuit against Mark B. Spiegel please message me. If this BS artist desires to continue with his legally dubious activities maybe a judge Is the only way to force him to shut up. I'm tired of seeing this scam artist in my feed and I find it disgusting that any news publication would cite him as an authority about anything.
FredTMC
Model S VIN #4925
Yep. Ideally, it's GSE related rather than LV.
Hey, here's a question: Since it's a static fire test of the first stage, why is it required that Spacex load fuel to the upper stage?
Unlike some other LVs, I don't think the upper stage requires pressurized tanks for structural stability.
Cuidado. Cars leased directly by Tesla do not contribute very much to a given quarter's revenue or gross profits, and are treated the same under GAAP and non-GAAP.
" Leasing through both our captive financing entities and our leasing partner exposes us to residual value risk and will adversely impact our near-term operating results by requiring the deferral of revenues and costs into future periods under lease accounting. In addition, for leases offered directly from our captive financing entities (but not for those offered through our bank partner), we only receive a limited portion of cash for the vehicle price at delivery and will assume customer credit risk." [Directly leased cars are eligible for ABL draws.]
Revenue and GM associated with leases through bank leasing partners are adjusted in non-GAAP, but not Tesla direct leases
"We offer a leasing program in the United States, Canada, the UK and Germany. Qualifying customers are permitted to lease a vehicle directly from Tesla for 36 or 48 months. We account for these leasing transactions as operating leases and recognize leasing revenues over the contractual term and record the depreciation of these vehicles to cost of automotive revenues. As of June 30, 2016 and December 31, 2015, we had deferred $42.1 million and $25.8 million of lease-related upfront payments which will be recognized on a straight-line basis over the contractual term of the individual leases. Lease revenues are recorded in automotive revenue and were $23.9 million and $40.6 million for the three and six months ended June 30, 2016.' [Tesla began the direct leases in the 2nd quarter of 2014 and had 6,180 cars under direct leases at June 30, 2016.]
Tesla guided direct leases would increase from 8% in Q2 to 15% in Q3. Also, InsideEVS partly attributed the August results to: " Adding to the demand profile for the Model S earlier this quarter was the start of 60 kWh cars. For August, it was a 24 month lease deal on the 60 kWh model ($593 month w/$7,425 down)..."
FredTMC
Model S VIN #4925
Regarding the US vs non-US mix in Q2...
There were 5k cars in transit. Many of these were on boats, so the mix in Q2 was at 60% US.
Historically, a mix of less than 60% US makes sense to me. Maybe 55-57% US for Q3
My two cents
Finally one journalist who is willing to say accurate information about the filing. To answer his question, NO. Tesla is not shortchanging SolarCity. The error was discovered, corrected, and thoroughly discussed before an agreement was reached as is very clearly stated in the SEC filing.
Is Tesla Shortchanging SolarCity Shareholders By $400 Million?
Seriously. I read the filing yesterday immediately after it was published, in about 20 minutes and it was clear to me in the very simply written timeline of events that SolarCity's debt was accidentally OVERSTATED by $400 million.
Why the heck are journalists saying SolarCity's debt was UNDERSTATED by $400 million?
Also, the filing makes it clear the mistake was noticed by both parties, there was some discussion about if the ratio would be changed, and both parties after much discussion and negotiations agreed the mistake wouldn't affect the ratio, and the original ratio was FAIR.
Seriously. WTH? This was in the part of the filing that was spelled out in simple English! All journalists who stated, or who seem to be implying that the error was never discussed or corrected are WRONG and have no excuse.
Is Tesla Shortchanging SolarCity Shareholders By $400 Million?
Seriously. I read the filing yesterday immediately after it was published, in about 20 minutes and it was clear to me in the very simply written timeline of events that SolarCity's debt was accidentally OVERSTATED by $400 million.
Why the heck are journalists saying SolarCity's debt was UNDERSTATED by $400 million?
Also, the filing makes it clear the mistake was noticed by both parties, there was some discussion about if the ratio would be changed, and both parties after much discussion and negotiations agreed the mistake wouldn't affect the ratio, and the original ratio was FAIR.
Seriously. WTH? This was in the part of the filing that was spelled out in simple English! All journalists who stated, or who seem to be implying that the error was never discussed or corrected are WRONG and have no excuse.
Just bought some $168 shares of TSLA.........at least I hope I did! (SCTY) I also dollar cost averaged my SCTY to below Tesla bid price. Win-win....as long as the merger goes through.
I feel the significant drop in TSLA share price together with new information of scty debt and topped off by space X crash may really shake investor confidence and could derail merger. That is why scty is trading at such a discount at this time. How big of a concern is this for you?
I believe spacex crash is a huge huge blow. Big hit to reliability which trumps everything else including cost in space.
Maybe scty bailout won't go through. I still think it's unfair to TSLA shareholders as do many of you. Any CEO who didn't have shares of scty would let it die and buy for pennies on dollar. Of course I was criticized for saying this earlier but it is even more clear with recent sec filing. Very disappointed with what has transpired over past several months beginning with speeding up model 3 ramp and including scty merger deal. Without these missteps, TSLA would be doing well making cars at 2200/wk and could self fund ramp over 5 years.
Elon is self destructing like in his biography just before he was pushed out of PayPal / X.com
Delivering nearly as many in Sept as in the first two months of the quarter might be a heavy lift
My over/under guess for the quarter would be closer to 22k.(that would be 26% higher than the all time high quarter of 4Q15)
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This is what i never understood about the whole.... '5k in transit end of last quarter so we should expect the same number in transit by the end of this quarter'.... argument.
By all accounts Tesla was mired in production problems until the last month of Q2. I would assume to at least make things look less terrible, Tesla tried very hard (and successfully) to ramp up production in the final 4-6 weeks. However, i imagine this was achieved partly at the expense of geographical batching. Why would we expect Tesla to have the same problems this time around?
dmckinstry
Model X 2019
My opinion is that an ever increasing of so-called "journalists" are either very careless (too eager to get out a story rapidly), or
functionally illiterate.
FredTMC
Model S VIN #4925
On the OpEx side, they guided 20% higher in H2 compared to H1. H1 had on average 434M per quarter. So, we're looking at 521M OpEx here. Then there's another ~40-50M of interest loss. So Tesla needs ~565M in gross profit to break even.
Last two quarters had 336.5M in gross profit on average. Adding your optimistic case of 150M, that's 486.5M, still missing 80M for break even. Under your assumption, they need 9000 more cars or 24k to break even non-GAAP in Q3.
And I don't think they can achieve 22% GM in Q3. Low margin 60 is in Q3 while high margin 100 is not. They have been doing just a little over 20% on GM in the past 3 quarters and I don't see it can increase to 22% with a shift towards lower margin cars, even considering they may have improvements on COGS. ASP will be lower too. And then you throw in all the promotions we're seeing, I would say using 20% as overall GM and ASP of 90k may be more realistic. So, in the 6000 additional car situation, it will bring in 108M of gross profit. At 21k cars gross profit is 378M, resulting in a 187M loss. To break even, they need 31k delivered, which is impossible. Even if I am more generous and optimistic to go with 22% GM and 95k ASP, that's 27k deliveries required.
So all in all, I don't think there's a reason to get any hope of non-GAAP profitability in Q3. It's not even an illusion.
FredTMC
Model S VIN #4925
Right.. I do NOT expect tesla to have the same problem this quarter.
All indications are that production has been humming along all quarter long. No "steep ramp". Just a gradual increase to 2200/week target by end of Q3
Maybe I'm naive but I have very little concern of the merger not going through. Elon has already done the institutional roadshow and it looks like a thumbs up. SpaceX explosion in the short-term obviously effects TSLA but in the long term is immaterial. We have been here before with the explosion late last year. Was that the end of SCTY and TSLA?
Did you really just state that speeding delivery of the Model 3 is a misstep? The Model 3 is the entire reason Tesla exists plain and simple. I understand this is the short-term thread and this change may have blown your short-term game to pieces but in no way is speeding the Model 3 a negative to Tesla. Elon is pushing the envelope as he always does not self destructing. Some one has to think big! Get on the steamroller or get rolled over!
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That is how I am reading it...so buying more SCTY
NikeWings
Active Member
Hi esk8mw.....I view the SCTY transaction, error included, as an irritant. TSLA should just walk away. Anyway, your bits about sales (agree), marketshare (not yet tested by any meaningful competitor) and historical access to the capital markets (true) are OK. But the fundamental go-forward capital and cash flow requirements of TSLA are quite challenged and that's my point. Its not so much about accessing the markets, (no short on smart or stupid capital), its about favorable terms (cost, structure, conditions) amplified by the amount needed. TSLA needs substantial incremental, low cost, decently structured capital to win this game period.
Currently we've got fatigued bondholders seeking redemption, senior lenders that haven't budged yet on their restrictive ST liquidity covenants choking the RC and a funding limit which has been capped by a key financing partner, previously feeding full purchase price income back to Tesla. These are just a few cracks but indicators of greater 'insider visible' pressure.
While the surface appears shiny with top line growth and gorgeous new cars, the infrastructure is stressed. The capital demand to support bond redemption, necessary R&D, equipment purchases, site expansion, giga construction, new production lines, SCs, SvCs, M&A (SCTY) etc. exceeds $1B easy. So where does $1B-$2B of incremental favorably structured & priced capital without significant pain to shareholders either through dilution, prolonged cash burn or both, come from in a global market with its own problems?
Big topics, financial analytics and lots of smart people here. For the realistic, attached are snaps from my model (sorry cant provide full) to spur fuller thinking. I welcome all financial and fact based discussions......which is exactly how smart capital will look at it. TSLA Financials_Qtrly Q2 I am not a trader but enjoy reading/learning from you. Thank you.
I understand your point of view and don't wish to argue, especially since I am also long tesla. Plus what's done is done...
I guess the big question for me is how tough will it be for tesla to
access the capital it needs in this environment. If it can get another billion or 2 soon, great things are possible. not sure how easy that will be...
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